Convenience and saving money are just a couple reasons why an association would choose to self-manage a property. Though, outside managing firms and property managers are hired and employed for good reason. The job requires collecting monthly condo fees, hiring and managing staff, responding to residents’ issues, among other expected and unexpected tasks.
“The primary advantages of self-management are a significant expense-savings for the association. Few associations self-manage because of the significant involvement that self-management requires,” says Attorney Russell Robbins, a partner with the Coral Springs-based law firm of Mirza Basulto & Robbins. “Obtaining bids for services and no buffer from the ire of residents is a significant deterrent to an association considering self-management. Depending on the number of association employees, the association may now come under the jurisdiction of federal, state and local laws as an employer.”
As Robbins correctly points out, self-management is time-consuming and requires an ombudsman-approach to tenant affairs. It also leads to employment-related legal issues that might require additional attorney services to ensure regulations are met. In some cases, the move to self-management is a stop-gap measure that sticks.
When to Switch
“Frequently associations move from management either with a management company, or a licensed manager as an employee, when the board changes hands from turnover to unit owner control, after a recall, or where a majority of the board members change after an annual election, or when the association fires the management company or the manager retires,” says Robbins. “In these gaps in professional management, the association may attempt to undertake self-management. In many associations that have been self-managed for much longer periods of time, they have a continuous supply of volunteers ready to serve the association as both board and committee members.”
Steven Weil, president of the Fort Lauderdale-based Royale Management Services, explains that the leading advantage remains cost savings for most associations but said the acting manager should live on the property so they are available to owners, and able to handle problems at any time, which provides boards with more control of day-to-day activities. Of course, he noted that there are drawbacks to this self-governing approach.